A surge in government spending in response to the coronavirus pandemic has led the United States to a record budget deficit.
According to new figures from the Treasury Department, spending in the country climbed to a historic high of $979.71 billion last month, while revenues plummeted 55% from the prior year to $241.86 billion. That totaled a deficit of $737.85 billion for the month of April. (Comparatively, monthly spending was roughly $384 billion the previous year.)
What’s more, the annual deficit reached $1.935 trillion for the year ended April — nearly double the $1.037 trillion gap for the same timeframe through March this year. Annual spending shot up to $5.2 trillion, while revenues decreased to $3.265 trillion. According to the Congressional Budget Office, the annual deficit is projected to hit $3.7 trillion by the end of September.
As the coronavirus swept across the U.S., the government increased its spending and cut down on taxes to help curb the economic fallout from the health crisis: In late March, President Donald Trump enacted a massive $2 trillion rescue package — the largest in modern U.S. history — to help prop up the economy. Two separate coronavirus bailout plans had already passed at the time — the first worth $192 billion, and the second about $8 billion.
What’s more, Tax Day — which traditionally makes April the government’s top month for revenues — was pushed to mid-July, giving struggling consumers and businesses three extra months to file their taxes without interest or penalties. Those missed revenues in April could translate to more money for the government in the coming months as more Americans file their taxes in May, June and July.
Large swaths of the U.S. still remain under lockdown, but an increasing number of states and localities have begun reopening businesses that were shuttered to contain the spread of COVID-19, which has killed at least 82,000 people in the country and sickened more than 1.37 million.